Gov. Paterson offers to release withheld New York school aid

ALBANY, N.Y. — The Paterson administration said Friday that it will release billions of dollars it owes to school districts by the end of June, if the Legislature approves a delay past the June 1 deadline set in law.

That should help schools better plan their finances as districts outside New York’s biggest five cities hold budget votes next week, Budget Director Robert Megna said on Friday. Their fiscal years end June 30.

Schools will receive $3.5 billion in June under Paterson’s plan. In March, he delayed a school aid payment that had traditionally been sent in the spring, even though it wasn’t due under law until June 1. Now, he said tax receipts expected in June will make it possible to provide all of the aid by the end of that month, in time for schools to close the books on their fiscal year and help their cash flow.

“Without those payments, school districts would not be able to make payroll,” said David Albert of the state School Boards Association. “They would have to borrow money just to make payroll.”

Still, a delay of the total until the end of June — the last month of schools’ fiscal years — could force some districts to borrow to afford payroll that can include lump sum payments for teachers on their summer vacation.

The bill to release school aid will be sent with an emergency spending bill Paterson will submit to lawmakers Monday. The emergency spending bill will also include part of the 4 percent raises for unionized workers that Paterson has withheld since April 1. That’s worth about $7.4 million. A federal judge ordered the Democrat to pay out the raises after the unions sued. But Paterson is only funding the raises dating to April 29 at this point.

The Senate and Assembly are reviewing the school legislation. Both chambers anticipate passing the emergency spending bill, because to reject it would shut down government.

“It is not our intention to take up legislation to delay school payments next week,” said Senate Democratic majority spokesman Austin Shafran. “We’re hopeful there will be no need to delay school payments ... we hope to have a budget by June 1.”

The emergency spending bills are required each week until a budget, which was due April 1, is adopted. But there is little if any negotiation under way and tensions continue to build between the governor and legislative leaders.

On Friday at the Downtown-Lower Manhattan Association Breakfast, Assembly Speaker Sheldon Silver repeated some of his past criticism at the lack of adequate renewal of lower Manhattan since the 2001 terrorist attacks. He said he’s “weary of the recalcitrance and tired of the absence of a clear and steady focus from leadership at the highest levels of our government ... that we are where we are after this much time is an embarrassment.”

Then Silver quipped: “And that’s all I’m going to say about the state budget process.”

It was a joke, but Albany has become a tough room.

Straight-faced Paterson spokesman Morgan Hook said that if the Assembly is really ready and waiting for the governor, then “they should pass a budget Monday.”